Florida bills limit roof refusal by insurers, add new fund

Published: May 21, 2022 12:39 PM EDT
FILE - Members of the Florida House of Representatives give Speaker of the House Chris Sprowls a standing ovation after Sprowls gave his farewell speech and had his official portrait unveiled during a legislative session at the Florida State Capitol, Thursday, March 10, 2022, in Tallahassee, Fla. Florida lawmakers are returning to the Capitol next week for a special legislative session aimed at addressing problems in the state’s turbulent property insurance market, a persistent and multifaceted crisis in a region vulnerable to damaging hurricanes.(AP Photo/Wilfredo Lee, File)

Legislation proposed by Florida lawmakers for a special session in the upcoming week to reform the state’s property insurance market would create a $2 billion reinsurance fund and prohibit insurers from automatically denying coverage to homeowners’ with older roofs.

Four bills filed late Friday in the state House and Senate would create a new fund in which insurers can purchase insurance to help insulate them from risk. The bills also would allow homeowners with roofs 15 years or older to get an inspection of their condition before insurers deny them coverage. If an inspection shows that a roof has at least five years of life remaining, insurers can’t refuse to issue a policy only based on the roof’s age under the proposed legislation.

Under the proposals, some insurers would be required to get coverage from the Reinsurance to Assist Policyholders program operated by the State Board of Administration.

In a proclamation calling lawmakers back to Tallahassee in the upcoming week, Republican Gov. Ron DeSantis highlighted several issues that have contributed to rising insurance rates in the state, including high rates of insurance litigation that drive up premiums and massive underwriting losses for insurance companies that have resulted in insolvency or canceled policies, among other things.

Florida Chief Financial Officer Jimmy Patronis, said in an interview that the state last year accounted for 9% of all claims filed nationally but nearly 80% of all the property insurance lawsuits.